Earnings, bond yields show opposite trends for the first time in 6 years

Earnings yield for BSE 500 firms down 120 bps in 12 months; latter up 110 bps

For the first time in six years, bond yields and corporate earnings yield are moving in opposite directions, creating headwinds for the equity markets.
 
Yield on the 10-year government bond is up 110 basis points (bps) in the past 12 months. Earnings yield for the top listed companies was down 120 bps in the period. This contra-movement earlier happened during the post-Lehman rally in 2009 and 2010 —bond yields climbed nearly 300 bps and earnings yield fell by 220 bps during the period. One basis point is a hundredth of one per cent.
 
The yield on the 10-year